Executive Overview

Beginning with the 2027 tax season, institutions must execute all electronic information returns exclusively through the Information Returns Intake System (IRIS). Originally launched in 2022, IRIS represents a modernization effort designed to streamline data processing, enhance validation protocols, and replace legacy architecture with a cloud-based web portal and application programming interface (API) structure.

For colleges and universities, this is not merely an administrative update; it is a complex operational hurdle. Higher education entities are uniquely situated as high-volume filers, routinely generating tens of thousands of Form 1098-T documents for student tuition reporting, alongside Form 1099 filings for independent contractors, vendors, and service providers. Moving these multi-system workflows—which typically bridge enterprise resource planning (ERP) software, student information systems (SIS), middleware solutions, and specialized tax providers—onto a singular, modernized platform demands sweeping cross-departmental coordination.

Industry surveys reflect deep-seated anxiety among higher education business officers. In recent webinars hosted by compliance and tax automation leaders, nearly half of participating institutional representatives identified the FIRE-to-IRIS transition as their primary compliance concern. With the IRS noting an average 45-day turnaround just to secure new IRIS Transmitter Control Codes (TCCs), institutional leaders, bursars, and tax analysts are being urged to audit their software ecosystems immediately, test third-party vendor capabilities, and secure their credentials well ahead of statutory deadlines.

Detailed Chronology and Technical Evolution

The transition from FIRE to IRIS marks the culmination of a multi-year federal modernization strategy. Understanding the timeline and the structural differences between the two systems is critical for institutional technology and finance teams.

The Legacy Era: The FIRE System

For decades, the FIRE system operated as the standard mechanism for large-scale information return filing. While functional, the architecture was built on older data transfer protocols that lacked real-time error detection. Under the FIRE framework, institutions would package bulk data files and upload them to the IRS.

However, systemic data mismatches—such as discrepancies in Taxpayer Identification Numbers (TINs) or erroneous legal names—often went undetected for weeks or even months. When the IRS finally flagged these issues, administrators were frequently forced to review, correct, and re-upload entire batches of data rather than addressing errors granularly at the individual record level. This lack of instantaneous feedback created administrative bottlenecks and prolonged compliance cycles for bursar and payroll offices.

The Modernization Phase: Introduction of IRIS

Recognizing the administrative burden of legacy systems, the IRS launched the Information Returns Intake System (IRIS) in 2022. Initially positioned as an alternative electronic filing option, IRIS was engineered to leverage modern web technologies, including XML schema formatting and direct API connectivity.

According to IRS guidance, the strategic roadmap for IRIS culminates in complete exclusivity by January 2027. At that juncture, the FIRE system will officially cease operations, making IRIS the mandatory conduit for all applicable information returns. The platform is designed to offer two primary pathways for submission depending on organizational volume:

  1. The IRIS Taxpayer Portal: A web-based interface tailored for smaller-volume filers. This portal allows administrators to manually enter data or upload comma-separated values (CSV) files, subject to operational thresholds such as a 250-form limit per batch.
  2. The Application-to-Application (A2A) Method: A direct, software-to-system transmission method built for high-volume institutions. A2A enables automated communication between an institution’s enterprise software infrastructure and IRS servers, minimizing manual intervention.

Supporting Context, Operational Challenges, and Metrics

The migration to IRIS introduces complex operational realities for colleges and universities. Unlike standard corporate entities that primarily file contractor and employee information, institutions of higher education manage a dual compliance burden: student educational tax credits via Form 1098-T and standard vendor disbursements via Form 1099.

The Multi-System Ecosystem

A primary vulnerability in higher education tax reporting is the sheer fragmentation of institutional data architectures. Queenie Lee, general manager of 1099 reporting at tax compliance software firm Avalara, highlights the structural risk inherent in modern campus tech stacks.

"Higher-ed filing workflows involve multiple systems from ERPs, student information systems, middleware, [and] 1098-T providers," Lee notes. "And each handoff is a potential failure point under [the new system’s] stricter validation."

Unlike the lenient batch validations of the legacy FIRE system, IRIS employs rigorous validation checks. Records are evaluated instantaneously upon submission, yielding distinct statuses: accepted, accepted with errors, or rejected. While this real-time feedback loop is a vast improvement over multi-month delay cycles, it also means that flawed data originating from disparate campus databases will cause immediate transactional friction.

Institutional Scale and Diverse Approaches

Colleges and universities vary wildly in size, staffing models, and technical sophistication, leading to divergent strategic responses to the IRIS mandate.

  • St. Louis Community College (SLCC): Finance Functional Lead John Dickey manages an institution that generates approximately 25,000 Form 1098-T documents annually alongside a modest volume of roughly 30 Form 1099 documents. SLCC intends to utilize a hybrid operational model, leveraging core enterprise resource planning (ERP) systems to handle automated 1098-T batch files while utilizing manual entry through portal interfaces for low-volume 1099 filings.
  • Iowa State University: Tax Analyst Matt Devick reports that the university already utilizes enterprise platforms like Workday to generate automated electronic files for Form 1099s while actively mapping out sustainable pathways for 1098-T generation. Devick emphasizes that regardless of software automation, data hygiene remains the ultimate baseline for success. "Third-party companies that we use, they’re only able to submit what you give them," Devick cautions, underscoring the necessity of internal data validation before transmission.
  • Monmouth University: For smaller institutions with constrained administrative headcounts, relying on specialized external expertise is often the most pragmatic path. Catherine Duriske, controller at Monmouth University, notes that the institution partners directly with an external tax consulting firm rather than depending solely on internal software configurations to navigate complex compliance standards.

Official Statements and Industry Perspectives

As the compliance deadline approaches, software vendors, tax professionals, and institutional administrators are actively aligning their systems to meet IRS specifications. Industry sentiment reflects a mix of appreciation for the technological modernization and anxiety regarding vendor delivery timelines.

Software Vendor Adaptations

Major enterprise technology providers have mobilized engineering resources to ensure seamless integration with the IRIS framework.

  • Avalara: In response to the mandate, Avalara has updated its comprehensive reporting suites to support the mandatory XML schema required by the IRS. The company has integrated specialized data fields capable of processing distinct TIN types and separate legal name structures, while building out capabilities to manage IRIS Transmitter Control Codes (TCCs) directly within compliance workflows.
  • Workday: Michael Hofherr, senior vice president and group general manager of industry product at Workday, outlines proactive platform upgrades designed to mitigate friction for institutional clients. Workday has already established operational support for IRIS-based Form 1099 filings through its core financial management modules. Furthermore, the company is rolling out direct IRIS integration for higher education institutions utilizing its student information systems to generate and transmit Form 1098-Ts, eliminating the need for manual CSV uploads.

Industry Warnings on Vendor Readiness

Despite robust software developments, institutional leaders remain wary of potential delivery delays and programming bottlenecks. John Dickey of St. Louis Community College voices a widespread industry anxiety regarding third-party dependency:

"The big challenge is the vendor. Getting the vendor’s new programming delivered to us, I think everybody’s going to be very anxious about that."

Echoing this sentiment, Avalara’s Queenie Lee stresses that vague assurances from software partners are insufficient. Following an early-year compliance webinar that drew more than 1,400 registrants—45 percent of whom cited the FIRE-to-IRIS transition as their primary compliance worry for the year—Lee issued a direct directive to higher education business officers:

"Ask every vendor involved in your 1099 or 1098-T workflow (your ERP, your student information system, your filing provider) whether they are IRIS-ready for Tax Year 2026. Get a specific answer, not a general assurance."

Future Outlook and Actionable Roadmap

The transition from FIRE to IRIS represents a permanent evolution toward digitized, high-validation tax reporting. For higher education institutions, successfully navigating this transition requires an organized, multi-step project management approach spanning the remainder of 2026 and culminating in the 2027 tax season.

Key Action Items for Higher Education Administrators:

  1. Secure IRS Credentials Early: Institutions planning to file directly must apply for a new IRIS Transmitter Control Code (TCC) immediately. Given IRS processing times averaging 45 days, procrastination risks severe administrative paralysis.
  2. Conduct Comprehensive Vendor Audits: Finance and IT departments must formally audit all software partners, ERP vendors, and 1098-T/1099 service providers to verify concrete technical readiness and confirmed support for IRS XML schemas and A2A integration.
  3. Map and Clean Data Pipelines: Because IRIS provides immediate validation and error rejection, institutions must sanitize internal databases—particularly regarding Taxpayer Identification Numbers (TINs) and legal name fields within student information systems and payroll platforms.
  4. Establish Cross-Departmental Collaboration: Compliance cannot rest solely within the bursar or tax office. Effective preparation requires synchronized coordination between institutional IT personnel, financial system administrators, payroll departments, and external tax consultants.
  5. Execute End-to-End Testing: Prior to the official filing window, institutions should perform rigorous test transmissions through the IRIS testing environment to identify system handoff failures, middleware bottlenecks, and formatting discrepancies before statutory deadlines take effect.

By treating the FIRE-to-IRIS transition as an enterprise-wide technology upgrade rather than a routine administrative filing update, colleges and universities can safeguard themselves against costly compliance penalties, operational delays, and regulatory scrutiny in the years ahead.